Tariffs Didn't Reshore Apparel — U.S. Capacity Fell 17%
In 2025 U.S. apparel manufacturing didn't see the promised "revival" — it shrank. Tariffs didn't pull the supply chain home; they just reshuffled it within Asia.
-17%
U.S. domestic apparel capacity, year on year
$2.98T
U.S. manufactured-goods imports — up 4.6% from $2.85T
$88B
Asia's 2025 apparel & accessories exports to the U.S.
75%
Of firms moved orders out of China — but not to the U.S.
Sourcing Shifted — It Didn't Reshore
Three-quarters of surveyed companies pulled purchase orders out of China. Those orders moved to other Asian countries — not back to American factories.
75%
moved purchase orders out of China
→
Other Asia
Vietnam, Bangladesh, India and neighbors — the orders stayed in Asia
20%
Only one in five companies even considered producing in the United States. Tariffs changed the country of origin — not the continent.
Why Apparel Won't Come Home
Kearney's report author Patrick Van den Bossche points to three structural reasons reshoring apparel is so hard.
01 · AUTOMATION
Low R&D, Low Automation
Apparel invests little in R&D and automates far slower than other industries — so it can't engineer away its dependence on low-cost labor.
02 · MARGINS
A Structurally Low-Margin Industry
Margins have always been thin. Financially, the sector simply can't absorb the cost of moving production lines back to the U.S.
03 · ECOSYSTEM
Asia's Entrenched Ecosystem
Asia has led the apparel supply chain for decades — a stable, efficient, fully-integrated ecosystem that reshoring advocates tend to underestimate.
Our manufacturing team is ready to step onto the field — we just need the goal posts to stop moving.
— A surveyed company CEO, on tariff-policy whiplash
Tariff rules changed almost weekly through 2025. Faced with that uncertainty, executives chose the lowest-risk option: keep doing what they were already doing — sourcing from Asia, just spread across more countries. For trade professionals, reading policy direction and how the supply chain actually works matters more than simply judging "tariffs high or low."
Source: Kearney Reshoring Index (KRI) 2026, authored by Patrick Van den Bossche; reported via CHINA TEXTILE. Figures are 2025 full-year.